April 2000 | Commentary | Supply Chain Technology

Global e-Logistics Comes of Age

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The technologies available through the Internet, combined with ongoing advances in logistics software development, have given supply chain management an enormous boost—far greater than those who first promulgated the supply chain could have anticipated. The scale of solutions has increased while the volume of transactions has grown at a staggering rate.

This is a time of opportunity for those companies that can look ahead, and for those that have done their homework. Let's look at two companies—G-Log and Eastman Chemical—that have been doing both, and aggressively.

Logistics managers have long been after a technology solution that would offer a secure system for scheduling and planning via the Internet, one that would provide maximum benefit to multi-carrier, multi-mode, and multi-leg shipments within an overriding business process system. This system would necessarily handle domestic and international transactions within a logistics trading community. The Internet would act as the means of communication between traders and customers. Logistics managers have wanted these systems to deliver real-time information in a cost-effective manner, to as far a geographic range as possible.

No system developed before the advent of the Internet could come close to delivering all these benefits. Prior systems lacked the robustness and ability to interact real time with customers in far-flung locations.

But now one very new company, founded in May 1999, offers just such an Internet-enabled solution. Global Logistics Technologies Inc. (G-Log), Shelton, Conn., www.glogtech.com, designed the G-Log e-Logistics Portal software specifically to fulfill these needs. The system moves users away from arduous rule-of-thumb solutions toward an integrated solution that can span the globe in terms of access and support. Decision support for planners can be based upon real-time information, use of connectivity tools, and data that has a company's own criteria built in as a critical advantage.

Through these means, companies can plan and track their freight anywhere in the world. G-Log makes use of its own algorithms and designed business rules to optimize shipments across a multi-enterprise supply chain.

You might wonder how G-Log achieved such a global reach so quickly. Well, the company's reality seems to equal its projections. In fact, G-Log already delivers e-logistics transportation management to industry giant FedEx. The logistics system G-Log offers is "designed to meet the specific needs of third-party logistics providers, and provide customers with greater visibility into the transportation and delivery pipeline on a worldwide basis," says Gary D. Gilbert, president and CEO, FedEx Supply Chain Services.

The G-Log software is designed to centralize freight services management globally. This economical service provides for transportation and on-time delivery of freight moving by air, by land, or by sea. We all have some idea of the scale and complexity of FedEx as a business because it impinges upon our lives so often and so critically. It's a double hit—G-Log provides a system for FedEx, and FedEx provides a more efficient system to its customers.

G-Log is not, however, resting on the laurels of its FedEx partnership. It recently launched a new company in association with Eastman Chemical Co., Kingsport, Tenn. This new joint venture, called ShipChem, concentrates on the transport of raw and hazardous materials in the chemical industry.

A company the scale of Eastman (15,000 people and $4.59 billion in sales in 1999) has been poised to take advantage of such a technological opportunity. Its preparation started formally in 1995 with its web site: www.eastman.com. The company expanded into a global communications network in 1996, and installed SAP R2 worldwide in 1995 and 1996. In 1997, Eastman installed a Dell computer platform worldwide.

In 1998, Eastman developed its global sales force automation system, and 1999 saw the creation of a store front called www.eastman.com. This same year also brought together the company's digital business ventures, SAP R3 in Latin America, and SAP R3 worldwide. It also saw a move toward global manufacturing information standardization, with full commitment from senior management.

ShipChem is moving into a logistics market estimated at $160 billion worldwide. Handling Eastman's own logistics will involve approximately $400 million. ShipChem's intention is to become a full provider for the chemical and plastics industry.

It will be interesting to see how these ventures proceed in the future. They are a reality only through G-Log's penetrating perception, and a persistent move forward on the part of Eastman Chemical.

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